2015 kansas housing markets...

2015 KANSAS HOUSING MARKETS FORECASTW

ICHITA

STATE U

NIV

ERSITY | W. FRA

NK BA

RTON

SCHO

OL O

F BUSIN

ESS | CENTER FO

R REAL ESTA

TE

AND PARTICIPATING REALTOR® MLS SYSTEMS ACROSS KANSAS

Special Thanks to:

It is with great pleasure that we present the 2015

Topeka Housing Market Forecast. This is the 5th

year we have prepared a forecast for the Topeka

market. As in the past, our goal is to provide you

with the insights you need to understand and

prepare for whatever the future may bring.

For all of the latest data and analysis

of Topeka real estate markets – and to

view our forecasts for other markets across

the state – we invite you to visit us at our

website at WICHITA.EDU/REALESTATE.

Dr. Stanley D. Longhofer Director, WSU Center for Real Estate

TOPEKAHOUSING FORECAST

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L ESTATE

2015 KANSAS HOUSING MARKETS FORECAST | TOPEKA | WELCOME

The Center for Real Estate receives no state funding. Our activities are supported entirely through gifts from generous supporters throughout the region:

Clark Real Estate Foundation

Meritrust Credit Union

Pulaski Bank Home Lending

Security 1st Title

Walter Morris Endowment for Real Estate

Wichita Area Association of REALTORS®

We are especially grateful to Lawyers Title of Topeka for underwriting the cost of preparing this year’s Topeka Housing Market Forecast.

We are also grateful to the REALTOR® boards and multiple listing services that have provided much of the data used to prepare this forecast:

PUBLICATION DESIGN BY

VISUAL FUSION GRAPHIC DESIGN visualfus iongraphicdesign.com

Faith Atteberry | WSU Center for Real Estate

Linda Briden | Topeka Area Association of REALTORS®

Karen Gehle | Kansas Association of REALTORS®

Jeremy Hill | WSU Center for Economic Development and Business Research

Tennsui Khow | WSU Center for Real Estate

John Ringgold | Real Estate Business Resources

Danesh Kumar | WSU Center for Real Estate

Participants in the 2014 Topeka Real Estate Roundtable

Oracle of Delphi

2015 KANSAS HOUSING MARKETS FORECAST | TOPEKA | ABOUT THE CENTER

CENTER FOR REAL ESTATE

WICHITA.EDU/BUSINESS

The W. Frank Barton School of Business at Wichita State has been the driving force behind some of the brightest minds and biggest ideas of the past 100 years. Combining the widest range of undergraduate degrees in the state and virtually unlimited learning opportunities (thanks to Kansas’ largest business community), it’s no surprise that employers continue to show a preference for hiring Barton School graduates.

Wichita State University has one of the oldest real estate programs in the country. Since its inception, the program has strived to maintain close connections with real estate professionals throughout the region.

The Center for Real Estate was established in 2000 to help deepen the connections between the professional real estate community and the academic programs at Wichita State University. Toward this end, the Center engages in a variety of activities that promote and enhance real estate markets and related industries:

¥�We�maintain�comprehensive�databases�of�publiclyőavailable�information�on Kansas real estate markets, and make many of these available on our website at wichita.edu/realestate. If there is data you need, let us know and we’ll see what we can do to help.

¥�We�provide�independentƂ�expert�analysis�of�area�real�estate�markets�and policy issues related to real estate.

¥�We�conduct�highőquality�academic�research�on�real�estateƂ�and�then�apply�this�research�to�develop�practical�resources�that�beneÞt�real�estate practitioners, policy makers and the general public. This forecast is�just�one�example�of�this�eȔortƁ�

¥�We�help�students�connect�with�area�real�estate�professionals� & organizations. If you have opportunities for current students or want to hire recent graduates, let us know and we’ll help you connect.

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Delphi

2014 20152

3

4

5

6

7

8

9

Perc

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2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

1-yearadjustable

rate

30-yearfixed rate

MBAforecastc

2

4

6

8

10

Perc

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2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

KansasTopeka U.S.

−10

−5

0

5

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Ann

ual P

erce

ntag

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ange

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

KansasTopeka U.S.

Sources: Freddie Mac; Mortgage Bankers Association; U.S. Bureau of Labor Statistics

Notes:

a) Year-over-year percentage change in total, non-farm employment, seasonally adjusted b) Seasonally adjusted

c) Mortgage Bankers Association August 2014 forecast of the 30-year conventional mortgage rate

THE TOPEKA LABOR MARKET APPEARS TO BE STRENGTHENING.

2015 KANSAS HOUSING MARKETS FORECAST | TOPEKA | ECONOMIC OVERVIEW

Since the Great Recession ended, Topeka employment growth has remained sluggish, even as the national economy has slowly improved. Over the past year, however, job growth has risen, suggesting that the overall labor market may�Þnally�be�improvingƁ

ECONOMIC OVERVIEW

FOR THE LATEST TRENDS AND STATISTICS, VISIT WICHITA.EDU/REALESTATE

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Over the summer, the Topeka unemployment rate dropped

to�a�postőrecession�low�of�ŗƁœ�percent, a decline that is all

the more encouraging given that the labor force has been

growing. This, too, is a sign of a strengthening labor market.

Mortgage rates remain exceptionally�lowƂ�and�the�Mortgage Bankers Association forecasts�that�the�ŕŒőyear�Þxed�rate�will�remain�below�5.3 percent through the end of�next�yearƂ�suggesting�that�Þnancing�costs�will�not�become�a hindrance to the housing market any time soon.

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2,5402,603

2,787

3,003 2,990 2,960

4,190 4,260

4,660

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HOME SALES & CONSTRUCTION


2015 KANSAS HOUSING MARKETS FORECAST | TOPEKA | HOME SALES AND CONSTRUCTIONW

ICHITA

STATE U

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ERSITY | W. FRA

NK BA

RTON

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ESS | CENTER FO

R REAL ESTA

TE

Sources: National Association of REALTORS®; Topeka Area Association of REALTORS®;

U.S. Bureau of the Census; WSU Center for Real Estate

Notes: a) Total home sales in the Topeka area as reported by the Topeka Area Association of REALTORS®

b) U.S. existing home sales as reported by the National Association of REALTORS®; forecast is the September 2014 forecast by the National Association of REALTORS®

c) Single-family building permits issued in the Topeka metropolitan area as reported by the U.S. Bureau of the Census d) U.S. single-family housing starts as reported by the U.S. Bureau of the Census; forecast is the

September 2014 forecast by the National Association of REALTORS®

TOPEKA HOME SALES SHOULD DROP

SLIGHTLY IN 2015.

The cold, wet winter meant for a slow start to the spring selling season this year. While sales have recovered somewhat since then, they still remain behind last year’s pace. Sales should drop again slightly in 2015, falling to 2,960 units.

New home construction in Topeka continues to

languish. After rising slightly in�ŔŒœŕƂ�we�expect�singleő

family permits in Topeka to decline this year by 11.1

percent. This trend will likely continue in 2015,

with permits falling another 8.3 percent to 220 units.

Sisyphus

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2010 2011 2012 2013 2014

Topeka U.S. HOMEPRICES

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2015 KANSAS HOUSING MARKETS FORECAST | TOPEKA | HOME PRICES


Sources: Federal Housing Finance Agency; National

Association of REALTORS®; Topeka Area Association of REALTORS®; WSU Center for Real Estate

Notes: a) Ratio of active listings to home sales, seasonally adjusted b) Year-over-year percentage change in the Federal Housing Finance Agency all-transactions housing price index for the

Topeka metropolitan area, as measured using 4th quarter values

TOPEKA HOME VALUES SHOULD REMAIN flAT IN 2015.

The Topeka housing market appears to be fairly balanced,

with the overall months’ supply of homes available for sale

running�between�four�and�Þve�months over the past two years.

Nevertheless, there has been little upward pressure on home prices.

After appreciating by 1.0 percent in 2013, average home values in the

Topeka area are on track to fall back again�this�yearƁ�We�expect�Topeka�

home�values�to�remain�ßat�in�ŔŒœŗƂ�rising by a negligible 0.1 percent.

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2010 2011 2012 2013 2014

Kansas U.S.

28,500 27,891

32,038

35,267 34,750 35,650

3,802

3,144

3,801

4,459 4,315 4,275

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Housing markets across the state have improved steadily over the past two years, but�the�rate�of�growth�appears�to�be�slowingƁ�We�expect�sales�across�the�state�to fall slightly this year, before rising 2.6 percent in 2015 to 35,650 units.

HOME SALES ACROSS KANSAS

WILL RISE BY 2.6 PERCENT

IN 2015.

KANSAS HOME

VALUES WILL RISE

BY 2.2 PERCENT

NEXT YEAR.

KANSAS FORECAST


Permitting activity is experiencing�a�similar�lullƂ�

especially because of the slowing of the large Kansas City market. We�expect�Kansas�singleőfamily�

building permits will remain level in 2015, at 4,275 units.

Despite the slowing pace of sales, declining inventories

of homes on the market have begun to turn the tide for home pricesƁ�We�expect�average�home�

values across the state to rise by 2.4 percent this year and

another 2.2 percent in 2015.

Sources: Federal Housing Finance Agency; National Association of REALTORS®; Participating REALTOR® multiple listing services across Kansas; U.S. Bureau of the Census; WSU Center for Real Estate

Notes: a) Total home sales in Kansas as reported by participating REALTOR® multiple listing services across the state

b) Single-family building permits issued in Kansas as reported by the U.S. Bureau of the Census c) Ratio of active listings to home sales, seasonally adjusted

d) Year-over-year percentage change in the Federal Housing Finance Agency all-transactions housing price index for Kansas, as measured using 4th quarter values

2015 KANSAS HOUSING MARKETS FORECAST | TOPEKA | KANSAS FORECASTW

ICHITA

STATE U

NIV

ERSITY | W. FRA

NK BA

RTON

SCHO

OL O

F BUSIN

ESS | CENTER FO

R REAL ESTA

TE

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KANSAS Total Home SalesBuilding Permits

Home Price AppreciationSales VolumeAverage Price

KANSAS CITYTotal Home SalesBuilding Permits


LAWRENCETotal Home SalesBuilding Permits


MANHATTANTotal Home SalesBuilding Permits


TOPEKATotal Home SalesBuilding Permits


WICHITATotal Home SalesBuilding Permits


2013 2014 2015FORECAST

20122011

27,8913,144

őœƁŒ4,256

152,579

22,8602,365

őŔƁŚ3,576

156,430

1,061126őŒƁř196

184,900

569186őŒƁŘ109

191,492

2,603228őŒƁŗ306

117,668

7,480702őŒƁś998

133,470

32,0383,801

őŒƁŔ5,094

158,988

26,7433,229

őœƁŒ4,503

168,375

1,290165őŒƁŔ235

181,947

6601881.8

133200,877

2,787263őŒƁŚ333

119,422

8,183783őœƁœ

1,080132,023

35,2674,459

1.36,002

170,190

29,0144,209

1.45,323

183,479

1,5382121.9

299194,646

7141740.7

147205,358

3,0032701.0

374124,387

8,9949950.4

1,262140,288

34,7504,315

2.4

28,9204,205

3.3

1,5801651.6

7302300.3

2,990240őœƁŕ

9,1809400.2

35,6504,275

2.2

29,4704,300

2.8

1,6401552.5

7702402.5

2,9602200.1

9,8109901.3

FORECASTSUMMARY


The WSU Center for Real Estate prepares housing market forecasts for each of the major markets across the state. A summary of these forecasts is provided here. To download a copy of the complete forecast for each market, visit our website at WICHITA.EDU/REALESTATE. While thereƂ�you�can�also�explore�the�wealth�of�additional�data�and�analysis we provide on housing markets across the state.

The WSU Center for Real Estate:Laying a Foundation for Real Estate in Kansas

Sources: City of Manhattan; Federal Housing Finance Agency; Heartland Multiple Listing Service; Kansas Association of REALTORS® and participating REALTOR® multiple listing services across Kansas; Lawrence Multiple Listing Service; Manhattan Association of REALTORS®; South Central Kansas Multiple Listing Service; Topeka Area Association of REALTORS®; U.S. Bureau of the Census; Wichita Area Builders Association; WSU Center for Real Estate.

Notes: Total home sales and average price figures include both existing and new home sales. Building permits reflect single-family residential building permits. Home price appreciation figures are the year-over-year percentage change in the Federal Housing Finance Agency all-transactions house price index, as measured using 4th quarter values. Sales volume includes both existing and new home sales and is measured in millions of dollars. Kansas City figures include transactions from both Kansas and Missouri.

2015 KANSAS HOUSING MARKETS FORECAST | TOPEKA | FORECAST SUMMARY

Pandora’s Box

Lawyers Title of Topeka is a family owned business that has helped close and insure thousands of transactions over the past 38 years. In choosing Lawyers Title, you’re partnering with our dedicated and professional staȔ�working�to�meet�your�individual�needsƁ�

We take a proactive approach to make the real estate�process�a�smooth�and�seamless�experienceƁ�At Lawyers Title you get more than a title policy, you�get�a�partnership�beyond�your�expectationsƁ

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